Trade Dries Up Along With Mississippi

Wall Street Journal
14 July 2012
By Cameron McWhirter

A year after historic flooding brought the Mississippi River up to record levels, the severe drought hitting the central U.S. has caused water levels along parts of the waterway to plummet, disrupting barge traffic from Cairo, Ill., to Natchez, Miss.

In some places, the water level is about 50 feet below what it was during the flood's peak.

At one bend of the river between Vicksburg, Miss., and Memphis, Tenn., barges ran aground several weeks ago because of low water and had to be rescued, according to Cmdr. Tim Wendt, chief of the waterways-management branch for U.S. Coast Guard operations in the central U.S.

The Coast Guard, the Army Corps of Engineers and barge companies are meeting regularly to monitor the growing problem, he said.

Barge operators have sharply reduced their loads to get through tightening river passages. They say major rain is needed soon or they would have to reduce commerce even more, causing shipment delays and driving up transportation costs. With forecasts showing little prospect of significant rain, hydrologists see no relief in sight for the giant inland waterway that also includes the Ohio River.

The rivers and their tributaries, which splay out across the eastern and central U.S. like a tree with many branches, let barge operators ferry key American exports, including grain, corn and soybeans, and imports such as steel, rubber and coffee. Coal, fertilizer and petroleum products move up and down the rivers as well. Barge transport is generally less expensive than moving goods by train or truck, depending on the location and the material.

While parts of the river system can handle normal traffic now, disruptions along the Mississippi—the main trunk of the river system's tree—cause costly delays. Shippers worry that the drought could become as bad as 1988, when low water halted barge traffic for days.

The system needs a major infusion of rain or "the vast majority of commerce would have to stop," said P.B. Shah, president of Ingram Barge Co. of Nashville, Tenn., the largest operator of cargo barges on the Mississippi and Ohio rivers.

Ingram, which typically handles close to 100 million tons of bulk cargo a year, already has reduced barge loads and the number of barges pulled by a single boat, shrinking the company's load capacity by more than 40%, Mr. Shah said. If conditions worsened, the company would have to reduce capacity to below 50% of normal levels, and consider invoking "force majeure" clauses in its shipping agreements, whereby natural disasters can be cited to free a party from contractual obligations, he said.

"It's causing headaches all up and down the river system right now," said Martin Hettel, senior manager of bulk sales for AEP River Operations, a St. Louis-based barge company.

Mark Fletcher, owner of Ceres Barge Line of East St. Louis, Ill., said about 70% of his 220 barges aren't being used now. First, the drought cut crops, reducing demand for shipping. Now, low water levels are making it more costly to ship.

"It's not good if you are in the barge business right now," he said. "In the last 60 days, you've watched a whole lot of money go out the window."

Some river ports have been forced to close temporarily or shut down parts of their operations because of the low water levels. At the port of Rosedale in the Mississippi Delta, port director Robert Maxwell Jr. said water levels are about 50 feet below what they were last year, when flooding shut down the port. If the water falls any lower, there was a "high likelihood" he would have to close, he said. One of the port's public loading docks is inoperable, with equipment normally in the water now hanging the air. The Army Corps of Engineers is supposed to come this week to dredge, where heavy equipment is used to dig out sediment from waterways to make them passable for shipping.

"This is absolutely not normal," Mr. Maxwell said.

The port of Lake Providence, La., recently had to shut down until it was dredged, and the port at Hickman, Ken., is closed, said Steve Jones, navigation manager of the Army Corps's Mississippi Valley Division.

"Dredging will definitely be picking up as the river continues to fall," he said.

At this time of year, the river is normally low, but less snow than normal in the upper Midwest this winter, a lack of major tropical storms coming to the lower Mississippi River region from the Gulf of Mexico, and the recent baking heat have combined to cause reservoirs and creeks that feed major rivers to shrink, said Marcelo Garcia, a river hydrology expert and professor at the University of Illinois at Urbana-Champaign.

"Even if it started to rain a lot now, it would take a long time to catch up" to normal river levels, he said.

Since major rain is not forecast any time soon, Mr. Garcia said he expected the low water levels to get worse.

Write to Cameron McWhirter at